{"url_path":"/sec/karo/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 QUANTITATIVE AND QUALITATIVE DISCLOSURES","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-09","source_url":"https://www.sec.gov/Archives/edgar/data/1828102/0001213900-26-066795-index.html","accession_number":"0001213900-26-066795","cik":"0001828102","ticker":"KARO","issuer_name":"Karooooo Ltd.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1828102/0001213900-26-066795-index.html","primary_entity_key":"0001828102","primary_entity_name":"Karooooo Ltd."},"word_count":451,"has_tables":true,"body_markdown":"**Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES\nABOUT MARKET RISK**\n\n** **\n\nWe are exposed to market risks in the ordinary\ncourse of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial\nmarket prices and rates. Our market risk exposure is primarily the result of fluctuations in foreign currency exchange rates and interest\nrates. Please refer to Note 29 to the accompanying consolidated financial statements included elsewhere in this annual report for information\nabout quantitative and qualitative disclosures about market risk.\n\n \n\n**Foreign Currency Risk**\n\n** **\n\nWe conduct business in multiple countries and\ncurrencies, and as a result, the Group is exposed to currency risk to the extent that sales, purchases, and borrowings of the foreign\noperations are denominated in a currency other than the respective functional currencies of Group companies. The functional currencies\nof Group companies are primarily the ZAR, USD, Euro, Mozambican metical, the Singapore dollar and Polish zloty.\n\n \n\n(Refer to the Risk Factors note on foreign currencies\non page 30 and Note 29.2 (c) on Currency Risk on page F-49) At this time, we do not hedge our foreign currency risk.\n\n \n\n**Interest Rate Risk**\n\n** **\n\nInterest rate risk primarily relates to our loan obligations with variable\ninterest rates. For example, amounts outstanding under our Term Loan Facilities accrue interest at variable rates linked to the South\nAfrican prime rate and 6-month Euribor which exposes us to interest rate risk. Short-term deposits held at banking institutions also carry\ninterest rates at prevailing market conditions.\n\n \n\nAn increase of 100 basis points as at February\n28, 2026 would have resulted in ZAR8.55 million in additional interest expenses. We have not entered into any financial instruments to\nmitigate interest rate risk.\n\n \n\n**Credit Risk**\n\n** **\n\nCredit risk primarily results from when a customer\nfails to meet its contractual obligations, and arises principally from our receivables from customer, cash deposits and cash equivalents.\nCredit risk is managed by each subsidiary subject to our policies and procedures. A significant percentage of our individual customers\npay via direct debit in order to minimize our credit risk.\n\n \n\nWe evaluate credit risk relating to customers\non an ongoing basis using independent ratings, or if independent ratings are not available, we assess the credit quality of our customers\nby taking into account their financial position, past experience and other factors, including the default risk associated with the country\nin which the customer operates. Individual risk limits are set based on internal or external ratings in accordance with limits set by\nour board of directors. The utilization of credit limits is regularly monitored.\n\n \n\nWe do not have any significant credit risk exposure to any single\ncustomer or any group of customers having similar characteristics.\n\n \n\n104"}